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Present; De Sampayo and Porter JJ.
RAMAYAH i MBERA LEBBE et al.
350—V. C. Colombo, 4,16*5.
ilfoif’on- on date of trial that ease stand over for settlement—Settlementembodied in a document—Denial of one party that there was mysettlement—Inquiry by Court whether there was a settlement-power of Court• to hold the inquiry—Court cannot act on settlementunless a// -parties agree—Civil Procedure Code, s. 408—Juris-diction.
On the date fixed for trial a motion was made ” that- the caseshould stand over till December 4 for settlement; and that if nosettlement was arrived at- by that date, judgment should be enteredfor the plaintiff.’' The motion was allowed. The terms of analleged settlement were embodied in a document; but there wasnothing in the document to show that the plaintiff was a party tothe so-called settlement; and nothing was said ns to what was tohapen to the case. On December 4 the plaintiff denied that therewas any settlement so far as he was concerned. The DistrictJudge made an inquiry and held that there was a settlement asalleged, and dismissed plaintiff’s action.
Held, that the order was wrong.
** The Court can only act upon a settlement which has not onlybeen mutually arrived at. but is stated to the Court- by bothparties. If one of the parties denies, though falsely, that therewas any settlement,v there is an end of the matter, and the casemust take its ordinary course.”
HE facts appear from the judgment.
Hayley (with him H. V. Perera), for plaintiff, appellant.
Keuneman, for first defendant, respondent.
H. J. C. Pereira, K.C. (with him J. Joseph), for second defendant,respondent.
March 27, 1924. De Sampayo J.—
The proceedings in this case are somewhat extraordinary andrequire to • be overhauled. The plaintiff sued upon a promissorynote for Rs. 5,000 made by the first defendant in favour of thesecond defendant and endorsed by the second defendant to the
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plaintiff. The second defendant was in default, and the first defend-ant filed answer, stating that he granted the promissory note assecurity for moneys that might become due from him to the seconddefendant on transactions between them, that the endorsement tothe plaintiff was fraudulent, that the plaintiff was only an employeeof the second defendant, that at the time of the endorsement therewas due by the first defendant to the second defendant only a sumof Rs. 500 which he brought into Court.
On November 3, 1922, when the case appears to have come on fortrial, a motion was made on behalf of the plaintiff and the firstdefendant that the case should stand over till December 4 forsettlement, and that if no settlement was arrived at by that datejudgment should be entered for plaintiff as prayed for. This motionwas allowed. So far the matter is clear, but what took place there-after is difficult to understand. It would seem that one NoorMohamado Rawter took uppn_ himself to effect a settlement, buthis settlement is quite extraordinary. The terms of that settle-ment are embodied in the document marked 1 D 1- The documentpurports to be a “receipt” granted by Noor Mohamado Rawterto the first defendant. There is nothing in the document to indicate-that the plaintiff was party to the so-called settlement, but at theinquiry by the Court it was stated that the plaintiff was present atthe arrangement, and agreed to it. The only reference to. theplaintiff and to the case is in a recital that the first defendant hadgiven the promissory note in connection with his transactions withthe firm of “ Sana Moons Sana & Co.,” and that one of the membersof that firm (the second defendant) endorsed the promissory noteand delivered it “in trust ” to Seena Ramayah Pulle (the plaintiff)“ who has sued you in case No. 4,165.” The document proceeds tostate the amount due by the first defendant to the said firm wassettled at Rs. 4,000 to be paid in the manner therein mentioned.The plaintiff was wholly ignored, and nothing is said as to whatwas to happen to the case. This certainly cannot be regarded as asettlement of the case. The Court can only recognize a settlementbetween the parties to the action. See section 408 of the CivilProcedure Code. On December 4 when the case was called, theplaintiff would appear to have denied that there was any settlementso far as he was concerned. The duty of the Court in those circum-stances was obvious. It was either to enter judgment for theplaintiff as agreed on November 3, or sweep aside all that relatedto an attempt at a settlement of the case, and to hear the case andgive judgment. The Court, instead ot doing so, entered upon alengthy inquiry as to whether there was a settlement or not. This isan impossible procedure. The plaintiff, even if he was present at thediscussion of the terms of a settlement, might well have withdrawnfrom the compromise. All said, the Court can only act upon a settle-ment which has not only been mutually arrived at, but is stated to
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the Court by both parties. If one of the parties denies> thoughfalsely, that there was any settlement, there is an end of the matter,and the case must take its ordinary course. The inquiry made bythe Acting District Judge is useless, and is a pure waste of time. Asthe result of the inquiry, the District Judge held that there was asettlement as alleged by the first defendant, and dismissed theplaintiff's action. In view of the nature of these proceedings, I amnot surprised to find that, though the settlement was made on thefooting that there was nothing due to plaintiff from the seconddefendant, and that the plaintiff was only an endorsee for collection,the Court on December 22 entered judgment for plaintiff againstthe second defendant for the full amount of his claim.
I think the only thing we can do is to set aside the order of dis-missal of the plaintiff’s action, and quash all proceedings sinceDecember 4, 1922, and remit the record ;$o the District Court for aproper trial of the case. The plaintiff is, I .think, entitled to thecosts of f/he proceedings in the Court below, and of this appeal.
RAMAYH v. MEERA LEBBE et al